Connect and get the inside scoop on Airline Companies

Welcome to Airline Pilot Forums - Connect and get the inside scoop on Airline Companies

If this is your first visit, be sure to check out the FAQ. Join our community today and start interacting with existing members. Registration is fast, simple and absolutely free.


User Tag List

Post Reply
 
Thread Tools Search this Thread Display Modes
Old 03-26-2006, 01:39 PM   #1  
Fun Officer
Thread Starter
 
RockBottom's Avatar
 
Joined APC: Feb 2005
Position: Dallas, Texas
Posts: 515
Default NWA, DAL Face Steep Legal Fees

Northwest, Delta Face Steep Legal Fees

Delta and Nortwest Airlines facing steep bankruptcy legal fees
By Armando Duke

(AXcess News) Houston, TX - Attorneys representing Delta Air Lines (OTC: DALRQ) and Northwest (OTC: NWACQ) have asked the bankruptcy court for $59 million in fees and expenses for between 3 to 4 1/2 months of legal work.

Airline employees are criticizing the amount the lawyers for the two airlines are asking the bankruptcy judge to approve after taking steep wage and benefit concessions. But lawyers typically make big fees in large bankruptcy cases and they could reap as much as $225 million between the two airlines before they exit bankruptcy.

Meanwhile, Delta is asking for an arbitration panel to cancel its pilot contract in order to impose $325 million in long-term wage concessions across its 6,000 pilots. Delta's pilot union said that it will call a strike if the arbitration panel approves Delta's request. A decision on the contract is expected April 15th. But Delta's pilots aren't alone, other employees of the airline have also taken steep pay cuts over the last two years.

Delta's lawyers have defended their fees saying that restructurings of this size are complex and difficult to manage, requiring teams of lawyers for lengthy periods of time to complete.

Estimates are that the two airlines legal costs could be $275 million, while United Airlines parent, UAL Corp., spent over $335 million over a 38 month period.

Northwest is targeting the end of this year to exit from bankruptcy while Delta expects it will take until sometime in 2007.

But in any bankruptcy case, the court decides how much lawyers can get and in most cases that is only 80 percent of the fees and expenses they submit. At times the court has even told attorneys they will have to wait and accept their fees later.

In Delta's bankruptcy case, 20 law firms have billed the court a total of $43.6 million for 4 1/2 months work. A hearing is set for April 3rd to weigh the attorneys fees for legal, financial and consulting services pertaining to Delta's bankruptcy case.

In Northwest's bankruptcy case, 18 law firms have bill the court for $15.9 million in fees and expenses for the first 3 1/2 months of work. Eighty percent of the initial fees and 100 percent of all the expenses have been approved so far.
RockBottom is offline  
 
 
 

 
Post Reply
 



Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes



All times are GMT -8. The time now is 12:28 AM.